To help balance that out. Used vehicle values, we'll talk about with some of our dealers, have normalized from the absolute apex of 2022, where the industry was in a situation that it had never seen before. If you had purchased a new vehicle, the vehicle became more valuable when you pulled it off the lot, and that was something that dealers and participants such as CarMax and Carvana needed to deal with. It led to quite a bit of volatility in their earnings along with their stocks over the course of the last couple of years. So it's good to see some normalization there, albeit at an elevated rate, with a supply that hasn't quite found its footing just yet. Incentives I mentioned are also rising, as are inventory levels. This is a measure that we look at. That 7.3% number is a measure of the incentive level as a percentage of the average transaction price for a vehicle, which stands at around $48,000, so not quite at the pre-pandemic levels of around 10%, but slowly creeping back up, and on an absolute basis, as we've seen average transaction prices rise, that 7.3% is more from a gross dollar amount than it has been. We'll discuss the impact on the used vehicle ecosystem as I wrap up here, but clearly, as an industry that's around 40 million units a year, relative to the 16 million or so units that consist of the new vehicle market, the used vehicle market has a massive impact on a number of different participants, including the financial services arms of the automakers themselves, rental car companies, and also used retailers, so that brings us to topics for 2025 and beyond. I think that that's a good starting point for our journey over the course of the next two days. Before we get started, as is tradition here, we're going to spend a lot of time together. If you could all, if we could pass around a microphone and very briefly say who you are and where you're from, we'd all get to know each other very well. While that's happening, I'd like to say that we do encourage colleague participation from a Q&A perspective. So please join in. And if we can start with Jonathan down here, we'll get going with NN to start. Jonathan Chin, Private Management Group. Good morning, everyone. Kyle Schulz, Private Management Group. Hi, Nick Bodnar with Gate City Capital Management. Harry Sauers, Gate City Capital. Andrew Coye, Living and Investing from Dubai. George Henning, Pacific Global. Sophie Matthei, Gabelli Funds. Elizabeth Castaneda, RSWP Inc. Roderick Aiken, RSWP Inc. Kristopher Keach, Gabelli. Neil Mesch, Huntington Bank. Chris Kiper, Legion Partners. Cliff Banks, The Banks Report and Autovate. Lee Armstrong, Private Investor. Mark Moffett, San Diego. Yeah, Gabelli. Tyler, also Gabelli. Andrew Hodge, Canaccord Genuity. Rafa Maia, PRIMECAP Management Company. Walter Schenker, MAZ Capital Advisors. And I have Brian Barry, about 30 conferences. But not paid to do so. Right. Carolina Jolly, Gabelli. Shireen Doultani, Schwartz Advisors. Spencer Brown, Schwartz Advisors. Cameron Smith, Gabelli Funds. Brian Nagel, Oppenheimer. Great. Thank you. So without further ado, I'd like to introduce our first company. It's NN Inc., based in Charlotte, North Carolina. They design and manufacture high-precision components and assemblies for a variety of end markets, not the least of which is the automotive market. Very exciting company led by their CEO, Harold Bevis, and Chris Bohnert, the company's CFO. It's about a $200 million company with about 400 in about a $400 million total enterprise value. So with that said, the floor is yours, Harold, and welcome to Las Vegas. Thank you, Brian. Thank you for coming, everybody. We have a little bit of an overview for you if you don't know the company very well. We're primarily in the automotive market, a Tier 2 part maker, and we're kind of young, started in 1980, and if you look at our company, we're about $500 million in revenue and 10% EBITDA, have a little over 1,000 customers. This year, we'll do right around $46 million EBITDA. We just released our earnings last week, and we have a little over 3,000 employees, and we also have a JV that we run and operate, and it appears in our P&L as other income. It's profitable. It's a joint venture with a public automotive company in China called Weifu, and that JV also is another $120 million in sales. We are considered a best-in-class maker of complex parts, and we guarantee tolerances to the micron level, and our targeted markets for these kinds of parts are passenger vehicles, electrical grid, and orthopedics, so implants. We are specialists in certain applications, steering, braking, fuel efficiency, electrical shielding, and vehicle control. We have two primary products made out of metal, stamped parts and machined parts, so turned on lathes and CNC machine centers. We have a global platform, and we generally are close to our customers in terms of engineering, sales engineering, and then we have our operations primarily in low-cost areas, and we're considered a strategic partner to Tier 1 manufacturers. If you look at our revenue breakdown, it's 60% mobile, which is automotive heavy, and 39% power. So the transition from ICE vehicles to electrical was a really good thing for us because the other half of our company makes electrical products and sells to the grid, Schneider, ABB, Eaton, these types of companies. So we had some in-house electrical know-how that we put to work on the vehicle side. We provide a growth play into the global auto market. Chris and I recently came in as new management. The company went through a rough period. If you look backwards at our financials, it's kind of checkered and one of our top investors in here, I see him smiling. And so we got to the point where we really needed to have tougher management. Yep. And so we brought in a new team last year. And we're underway with a transformation plan. And it's kind of the way we've pitched ourselves as a stock over the last year. And it's underway, and it's gaining traction. And we have overperformed in certain areas, specifically getting on new vehicles. And in other areas where we're focused, we're a little bit behind where we want to be re-entering into the medical market. The global trends favor our capability. So if you look at autonomy and vehicle control, it leads to precision control of the vehicle, which leads to micron-level metal parts that are quiet and tough. And that's what we specialize in. We do our own heat treating. We do our own plating. We're vertically integrated. We buy rod stock and coil stock. And we develop the products from there. We do all our own die design in-house. We have a unique view into the industry because we're a part maker and we're involved in many, many Ford programs. And we sign NDAs for everything we do. And we don't have a 100% hit rate, but we quote on a lot and we see a lot. And we work with all the big Tier 1 and, in some cases, the vehicle makers when they do their own Tier 1 design and manufacturing. Probably our biggest end customer is BYD in China. And they've just been exploding with steering and braking advancements and have really pushed us. And it's caused us to have our highest tech equipment in China. And we're building a new factory in China, our fourth. And this precision metal part making carries over into medical implants. And our company sold its medical business three years ago and the non-compete ended in October. We re-entered it. And we still have our certifications, but you have to earn your way into that market. But it's a growing market, is strong and growing, especially with pickleball now, everybody needing knee surgeries. So we make knee implants, hip implants, ankles, the whole deal. And it's basically a machined titanium part with a coating on it that's biocompatible. I'm not going to go through all of our markets here in the interest of time, but we don't have any markets that are declining. But we don't have any explosive growth either. We're kind of a steady-eddy market context. So we're operating in the context of growing markets. The only area where we're kind of out of capacity at the minute is in electrical grid control. And our top customer there is Itron. You probably don't know that name, but they're big in smart meters and grid management. We make their smart connectivity in their grids. They have a three-year backlog. They're trying to get caught up. We're oversold in China. Except for that, we have open capacity that we're trying to fill. This is just a little piece about our footprint. We have a few thousand machine centers. We have them insured for around $600 million. We add machines every year, $20 million-$25 million. The two businesses, stamped parts, this is some pictures here of stamping. If you haven't seen stamping, obviously, it's a prevalent manufacturing process in the automotive industry, castings and machining. We're good at it and have been doing it for quite a while. It's a good cost-effective way to make a metal product if you can. It's very little labor. It's primarily automated processes and robotic handling between work centers. Mobile is machined. It's different. Lathes, Swiss lathes, CNC equipment. Again, it's very automatic, automated, and robotic. But you design these types of parts that go into vehicle control and various types of precision control. Just wanted to restate, Brian touched on most of the trends. I just wanted to point a few trends out that we've seen in the last year. It's been a very opportunity-rich environment in the automotive industry with all the vehicle proliferation that's happening and the starts and the stops and the accelerators and then brakes. But we're involved in it, and we don't have any choices but to hang with it. This year, I agree with Brian's numbers from Ward's and others. It looks flat and calm, like a peaceful sea, but it has been a lot of action underneath on vehicles. We have a lot of accelerator programs right now and a lot of starting and stopping going on between BEV, hybrid, and ICE, and diesel. So people don't talk a lot about diesel, but there's a lot of activity on high-end diesel as well. I won't go through the points here, but we have vantage points into all the top customers and their programs. Generally, when we win business, we've won $100 million of business in the last year or so. It's for a vehicle that will be launched 27 months from the day of the award. And you build prototypes and do crash testing and things along the way. So we have a big visibility into our next few years. Big theme is China. Brian mentioned it. Everyone's going to mention it. And we're done. We're very China. So if you don't like China, you don't like our stock. Because China is very important to our type of manufacturing, part making, the metal part making that we do. There's some really good companies in China, and we're one of them. And the supply chain for the Tier 1 that we support are China-centric. And it's a good low-cost place to be. You touched on China in your chart, Brian. Our biggest customer is BYD. And they've already taken over as a lead exporter in Mexico, Brazil, Australia, Russia. They're building new plants in Hungary, Mexico, Brazil, another one in China. And when they do that, we have to support them when they're going through it. So we kind of follow where the factories are being built. So we set up close by so that we can do JIT support to them. A lot of things happening in steering. I know it's not something you probably think about much as an investor, but there's a lot of things happening in steering, rear wheel steering, precise steering, quiet steering. The key of the whole deal boils down to these parts you see here. Worm gear has to receive an actuation signal and physically turn a shaft. We make that part. It cannot fail. It can't fail. If it fails, your steering wheel fails. Quality is very important. We're a Six Sigma manufacturer. So we're a Six Sigma manufacturer. Our defects are measured in parts per million. Electric vehicle shielding has really come on with high voltage, as high voltages have come into the vehicles. It's a growing market. It is really growing in density inside of the vehicle, shielding everything from each other so that you don't get EMI or EMF cross-talk or interference inside of the vehicle. And it leads to gold-plated and different precious metals to attenuate the signals and ground them. And luckily, we were doing that in the electrical industry for electrical grid, and we've taken it into the vehicles now. Rear wheel steering is coming out now too. The tank turns like the G-Wagon. And all the next-generation vehicles that you see have really sophisticated steering for tight parking and emergency avoidance. And it leads to higher density of our parts. So basically, they're steering on each wheel. The new market that we're in is orthopedics. And there's a lot of screws and different parts that go into orthopedics, plates, grates, pins. And we can make all of them on our automotive equipment. In fact, they're a lot easier. The hospitals are easier to get along with than the automotive companies, so we usually have higher pric ing here too for the same machine hours. The same machine. It's an Index 32 nine-axis machine and makes parts for automotive or medical. So we have an organic growth program we started a year ago. Chris just joined a couple of months ago. We've worked together before to prior company, and we've overperformed, as I've mentioned, in certain areas and other areas we're trying to get it going, but we've come up with a little over $100 million of forward growth that's not in our revenue yet. So we're generally winning programs that are on a next-generation product that's yet to be launched. So inside our company, we're kind of busy. We have over 80 programs we're launching. Deleveraging is a focus for us if you look at our balance sheet, and we're happy to say that we're focused on that and driving down our leverage, and now it's just under three times. We speak in our conferences about our transformation plan. NN, if you research the company at all in its past, made some avoidable errors, and so we're correcting certain things with leadership, unprofitable plants, getting after margins, deleveraging, and fixing the top line. And just did a judgment thing here on percentage completion. I would say that after one year, we're around 40%-50% where we want to be. The value is not reflected in the stock. Of course, you expect me to say that, but it really is true for us when our revenue is in the future, when we're running stuff for the future. Our three- and four-year models that you see are real if you see the wins behind them. Otherwise, it's just made up. Just gave you a few statistics here on how it's going. The highlights for us as an investment, we're kind of a young company, haven't been a spectacular performer. We brought in a seasoned management team. We have a very good board of directors. We have good current investors. We brought in new leadership in the last year. We got after the different elements of the turnaround, getting after the cost, the growth, and the cash. We're at the beginning of it. We've been doing very well to the point where we're building factories to support the sales growth that we've launched. We have a goal to get our ratios in line on our balance sheet as well. We have guidance for the year. We gave our results last week, and we stood by our guidance for the year. This is just an overview of it. With that, I kind of went quick, Brian, so we can get to some questions. Great. Thank you, Harold and Chris. Let's go back to, oh, let's start with Mario. No, no. Come on. You don't need to do that. Independent of that, welcome. How are you guys getting paid? The more realistic question. You won $100 million worth of business. Is that a new part on a vehicle, or is it a replacement of another supplier? If it's a rewin, we don't count it as a win. I got you. Thank you. Yeah. The JV in Japan, is there a put call on the 49% you own? Who's your 51% owner? The JV is in Shanghai, China, with Weifu, who is a successful auto part maker of fuel systems and steering systems on the Shanghai Stock Exchange. We don't have a put call. It's a 17-year. We're in our 17th We're in our 17th year. It expires in October of 2025. And I'm using that as an advantage for us to get some proper terms and conditions into the JV. Well, this is our first, but not our last meeting with you. So welcome to the company. One last question on the JV. Are you consolidating the debt on that in your books, or are you just taking it on an equity basis? Thank you. Thank you. The JV has no debt, and it's consolidated on Weifu's books. And we show 49% of the net income as other income on our P&L. It's a profitable JV. If you look at the math, you can back into this 25%-30% EBITDA JV. So unconsolidated. Yeah. Harold, you came over from CVGI. There are a number of different items to your turnaround story here. How do you evaluate the confront, fix, or exit way that you're looking at your portfolio? And of this profitability, where you're halfway there, how much is just you needing to fill capacity, and how much is operational improvement that needs to be done at the blocking and tackling level within your facilities? Yep. Well, if you look at my background, I'm a turnaround CEO. This is my sixth one. I guess turnaround, you're supposed to say transformation now, I guess that's an old word, transformer. And the hardest to fix usually are your revenue problems. But your confront, fix, or exit question of basically collecting all the issues underway of the company, dividing and tackling them, figuring out what the team can do, upgrading the team, and then looking at the return. Usually try to balance between cost out and growth. But the real tattoo on this company was an inability to grow. So we've balanced towards growth in this case. And so when I hired Chris, he's like, hey, you're almost like a pre-revenue company. We got $100 million out on the books. So we've tilted it. We've tilted it heavily towards growth for now. Yeah. And when you came in, I think you had seven plants losing $10 million of EBITDA. Three of those are now positive. What's been the key to turning those around? What were the initial steps anyway? Yep. So there's a third person not here, Tim French. He's our Chief Operating Officer. And he and I have worked together at three companies since 2003. And Tim's our Chief Operating Officer. He grew up in a factory, ran a machine, worked his way up in the union and all that kind of stuff. So you really can't BS him in a factory. And Tim took those. And the basic problem at the company, by the way, was a lack of discipline around on-time delivery. And that was leadership as well as organization. And we were overstaffed. And so we leaned out the direct, indirect, and salaried people that support the plants and created plant groupings to have one team support multiple plants. And since Chris has got here, he started to get after the G&A functions as well. Yeah. Additional cost outs. Yep. This is an automotive conference by its DNA, but we are not necessarily just automotive investors. What really potentially excites us as well is the growth in medical that makes a lot of sense, and we've seen a number of companies that had their roots in automotive grow outside and get a multiple revaluation, multiple expansion within the market as a result. What is this market for you now, and what do you think that this medical market could be over the next several years? Yep. So the medical business that we sold in October of 2020 was $380 million in sales and around $80 million of EBITDA. It was very profitable. It had dedicated equipment and plants to it, and it's a big market. The metal parts market for medical use is a big market, and so we have big aspirations. So we've put a goal out there of $100 million by 2028, and that's also going to involve an acquisition. We've been looking at acquisitions. We don't really have the capital. We don't have the balance sheet capacity right now, but we're developing some space to do that, so I think it's going to be around $50 million of organic, $50 million acquisition. The keys to getting back in, we kept a $15 million tools business. So we kept the orthopedic tools business where you insert rods and pieces into your body, so we maintain our FDA certifications at five plants, and we're a proven supplier, but we sold our capacity. It's now owned by AMETEK, and we're adding capacity, and we're getting back into it, and so these are companies like Arthrex, J&J. And you have to go in. You have to get approval. You have to win a piece of business. Then you have to launch it. And they want to see that you don't choke when you launch. And so assuming that we do that properly, we have a big queue behind it. And if you do poorly, you're out. Yeah. Carolina? So I think a big question out in the market today, if you can answer this or have any thoughts on it, is BYD coming into the U.S.? Yep. Well, I think everyone in the room reads what I read to the same amount. It's a very close thing to follow. I for sure think that whoever wins the election is going to block them. But BYD internally, we go to BYD's headquarters a lot in Shenzhen. And their export sales plan don't really involve the U.S. It's going to be cream of the crop. They're actually attacking other countries and winning. Long term, they hope to get over that hurdle. But their basic production practices that they have right now assume no victories in the U.S. I'm assuming you're talking about the U.S. Yeah. But they've really swarmed other countries. If you go to Brazil or other countries, they're on the roads and they're leading new registrations already. Great. And then just, sorry, one additional one. I think you mentioned additional capacity outside of China. Where do you think you, how do you think you fill that? Is it a new technology, some more kind of exciting, innovating customers coming in? Yep. So the big technology push for metal part making is sub-micron level, sub-micron level. You may not have a feel for that, but that's really hard to make things at that level with that precision and measure it and repeatedly do that type of a part. So we launched those processes in China. Then we're going to replicate them. We're going to replicate them in Poland and in Brazil and the United States. But the first victories we had were in China. So we're perfecting the process there. We're not going to get ahead of ourselves, even if we had the money, which we don't, because it's expensive. It's going to cost $30 million to do that in China over three years. So that's a lot for a little guy like us. So once we get the process ironed out, we'll replicate it. We can get operating leases, but we've been hesitant to do operating leases. We're just going to take our time for a minute, buy the capital ourselves, or do financial leases. You mentioned financial flexibility, a little bit restrictive right now. You also have some mezzanine debt that acts effectively as a preferred. Can you talk about this journey over the next five years and how you incorporate this balance sheet that is a little bit restrictive this year? You certainly didn't inherit the easiest. We'll call it a turnaround opportunity. So talk about that. This is when Chris likes to talk. I love our capital structure. No, I think it has a lot of improvements. So that's one of the things Harold and I are working on. And we've got an ABL, we've got a term loan, and then we've got the pref, as I call it. So yeah, we're currently underway with trying to refinance all three parts. We're looking at all kinds of opportunities. Obviously, the ABL market's an easy one, right? We can securitize that with our AR and our inventory. The term loan, we're trying to get some flexibility so we can fund all this growth. It's actually really exciting. This business has high quality, a lot of growth. We don't always talk about the stamping business. I was just there last week, but it's a stamping and a plating business. And that plating business actually has some semi-barriers around it as well. There's not many metal platers. It's kind of like jewelry plating. So not only that, we have China. So we're trying to get a capital structure that helps us fund all this growth. It's actually $113 million of new business over the last year that Harold's and team have brought in. So that's a key priority for us over the next couple of months and willing to listen to anyone. And on the pref itself, obviously not something that you created, but how do you think, from a partnership standpoint, the investors in this instrument want your next five years to go so that they can be paid appropriately? So the pref's held by one person, Morgan Stanley, one holder. And so he wants out eventually, right? So there's no pre-payment. There's no issues right now with taking them out. If Chris and I could have our way, we'd have like three people belly up and take a third each. But what do I think that's going to happen? I think that we're going to gradually refinance a few times. And we are looking at acquisitions that will accelerate the game plan we walk through. One of the things I said was we have a really good board, and we do. One of the reasons I left CVG to come here with Chris, Chris was my CFO there, is because the board wanted to get to $1 billion and wanted to support a knowledgeable team to run the company as it is and then add acquisitions at the right time. So I think that we'll do a little bit at a time. We have patient investors. We're not the kind of stock where people are trying to make 3%. People are trying to make three times their money. We have investors that understand that and know that that's what we're trying to do. I don't know. You got another opinion on that? One of our top investors. Yeah, sure. So I think one of the things that would be interesting to point out to everyone considering an investment in the company is the compensation structure for the management team is focused on the stock going up. They have vesting of shares that happens every dollar the stock price goes up between when Harold showed up at $11. The stock's sitting today at $3. So this team is really, really focused on growing this business and getting the stock price up. And I think that's pretty exciting for investors. There's not very many public companies that have this good of alignment between the management team and the shareholders. It's a private equity structure comp program. That's terrific. So Harold and Chris, in the interest of time, we have to move along. But first time here, hopefully not the last. Thank you very much for. That's terrific. So Harold and Chris, in the interest of time, we have to move along. But first time here, hopefully not the last. Thank you very much for. That's terrific. So Harold and Chris, in the interest of time, we have to move along. But first time here, hopefully not the last. Thank you very much for. That's terrific. So Harold and Chris, in the interest of time, we have to move along. But first time here, hopefully not the last. Thank you very much for.